Will NATO’s European Members Put Their Money Where Their Mouth Is?

There is, though, a caveat to consider here, in that the 5 percent target is actually split into two categories. The first, which accounts for 3.5 percent of annual GDP, will be directed towards so-called “core defense requirements,” while the remaining 1.5 percent will be allocated to “defense- and security-related spending.” If that second category reads as vague, that’s because it is. “Countries report their defense spending according to common guidelines, but there is no [universal] definition of defense spending,” explained Guiberteau Ricard. “This is a challenge for this new pledge, as countries may want to show their commitment to high defense spending [by] using a broader definition than they used to. It would not necessarily lead to higher defense capability. The 1.5 percent of GDP dedicated to ‘defense- and security-related spending’ is particularly questionable.”

In other words, NATO countries may seek to meet their new defense spending obligations by allocating some of their national budget towards civilian infrastructure projects that may, conceivably, be able to serve a military purpose. It has been reported, for instance, that Keir Starmer plans to reframe a £5 billion rural broadband scheme as a military investment—meaning it could fall into that 1.5 percent figure dedicated to “defense- and security-related spending.” Italy, meanwhile, reportedly wants to count a €13.5 billion bridge to Sicily as defense spending.

Still, while governments may be incentivized to think creatively about what constitutes defense spending, it is clear that a greater share of NATO members’ wealth is going to be diverted into the military from here on out. NATO spending is not presently shared equally, with Poland, for example, spending 4.12 percent of its GDP on defense in 2024, while Spain spent just 1.24 percent. But taken collectively, NATO members spent an average of 2.2 percent of GDP on defense last year—amounting to a total of roughly $1.5 trillion. To meet a 3.5 percent of GDP target by 2035, according to SIPRI estimates, NATO members would need to allocate an additional $1.4 trillion a year towards defense than they managed in 2024. To hit the full 5 percent target, an extra $2.7 trillion would be needed. That would take annual NATO spending to $4.2 trillion.

These are numbers so large as to seem utterly abstract, but it can be helpful to break them down into national terms. If Germany, for example, is to hit the 5 percent target by 2035, it will, according to SIPRI, need to spend $329 billion on its military that year. France will spend $221 billion, and Italy $158 billion. For context, the respective annual education budgets for those three countries are, at present, $283 billion, $225 billion and $126 billion.

Finding all this extra money for defense is going to be a problem for European governments already struggling to fund infrastructure. Many of NATO’s European members are highly indebted, with Greece’s government debt standing at 152.5 percent of GDP during the first months of 2025, Italy’s at 137.9 percent, France’s at 114.1 percent, Belgium’s at 106.8 percent, and Spain’s at 103.5 percent. Even Germany, for so long constitutionally bound to retaining a reasonable debt level, recently decided to break its own fiscal rules to allow it to take on more debt for military spending. While it largely remains an unbreakable taboo among Europe’s establishment to borrow for the sake of funding socially useful infrastructure, it seems it is absolutely fine to do so to pay for bombs and tanks. 

This is politically risky. European decline is palpable today, and people throughout the continent are falling into a despair that is, for the time being, most visibly finding expression through the rise of the far right. This is not a problem that will be fixed by taking on more debt for weapons and, as will surely be the case, redirecting other elements of government spending into defense. This is likely to spark a fierce backlash from populations already furious with an elite that has entirely lost touch with their needs.

Some leaders have attempted to frame the defense splurge as a way to jumpstart Europe’s ailing industrial sector, but this is a dubious claim. Modern arms manufacturing, as economist Grace Blakeley has argued in Tribune, “is not especially labour intensive,” and it does not, as Ben Wray wrote in Jacobin, “spur wider economic activity in the same way as building socially useful infrastructure like electric battery charging points or solar panels would.” On the other hand, as an essay co-authored by Guiberteau Ricard pointed out, sharp increases in military expenditure have, in the past, been associated with outcomes like corruption, overpricing, and procurement inefficiencies. Europe already struggles with such issues, and throwing money at them may, far from helping, simply exacerbate them.

Europe’s NATO members already collectively spend more on defense each year than Russia does, while their combined armies boast more active-duty troops than the United States. Clearly a huge problem for Europe is not the amount of money it spends on defense but, rather, how it spends it. It is deeply inefficient, with individual European countries each possessing weapons systems that are incompatible with those of their European allies. With nations acquiring weapons independently of one another, Europe, as a whole, is unable to gain economies of scale by ordering systems in larger batches. This is a problem of coordination, and blindly pumping more money into the system, without an obvious plan for how it will be used, will not automatically fix it. “There is, as of today,” Guiberteau Ricard told me in her email, “not much [of a] strategic spending plan on how higher levels of defense spending will be used, [or even] if they can be reached and sustained. This is a challenge for efficient spending that may be addressed in the long run.”

The new NATO pledge to spend 5 percent of GDP on defense does, if we ignore Spain’s dissent, ostensibly present a united front of its European members. But in practice, as Guiberteau Ricard noted, “cooperation is a long process to set up.” Europe’s capacity to develop weapons systems is, at least for now, limited, which means importing them from abroad will likely be the short-term solution. And, as Guiberteau Ricard pointed out, “buying ‘off-the-shelf’ from the U.S. has historically been the quickest way to get equipment, because of its larger production capacity… Some equipment is [also] imported from external competitors on the defense market, such as Türkiye or South Korea.” In other words, this defense splurge that is being touted, at least in part, as a way to revive Europe’s industrial sector and to establish independence from the United States, will, ultimately, flow abroad to the United States, as well as to other countries.

Largely lost in the conversation about European defense spending is that there are outright dangers associated with this dramatic remilitarization. The 5 percent target represents, if nothing else, a signal to NATO’s enemies that it intends to protect its interests through the use of hard, militaristic power. Diplomacy, correspondingly, will be of less importance. This shift in priorities has already begun, with Europe, led by the United States, allowing the euphemistic “rules-based order” that it used to rhetorically revere to be dismantled. While the rules-based order was always deeply flawed and contradictory, we may soon find that, without it, the world is a much more dangerous place, and that Europe is in a weak position to thrive in it.

Despite his open disdain for them, European leaders have bent to the will of Trump, while, at the same time, they have continued to perpetually saber-rattle the Russian beast. If Russia is genuinely such a threat, which, as demonstrated by its atrocities in Ukraine, it certainly seems to be—though whether or not it would actually invade a NATO member is another question—surely the best course of action for Europe to take, in light of its uncertain support from America, is to reestablish diplomatic ties with it. To negotiate and attempt to avoid war, while, nonetheless, addressing its military inefficiencies without destroying its own national economies in the process. There are, in other words, alternatives to the profoundly risky road Europe is heading down, but, given the hawkish leadership that currently rules the continent, they are likely to be ignored. Vast sums of money will be spent on war machines, and the society’s decline will prove difficult to arrest.